Massachusetts Lags Behind Neighbor States in Implementing Bulk Purchasing Plan for Prescription Drugs

While Vermont, Maine and New Hampshire have all applied for federal waivers to use bulk purchasing to drive down the cost of prescription drugs for residents, a similar plan in Massachusetts, first proposed 19 months ago, remains in the "planning stages." As a result, Bay state residents, at least in the near future, may pay significantly more for medications than their New England neighbors, the Springfield Union-News reports. In December 1999, state Sen. Mark Montigny (D) announced that the state was about to undertake a bulk purchasing plan, which "instructed then-Gov. Paul Celluci (R) to combine" several state programs "that buy drugs" -- including Medicaid, mental health programs and state employee health plans -- "into one purchasing pool that would wield more leverage when shopping for medications," the Union-News reports. "This is not strange stuff. It goes on every single day in every single aspect of commerce in society," Montigny said. However, the plan came along at the same time that Prescription Advantage (see story 3), a drug insurance plan for seniors, was getting off the ground. Because of that program's launch, consultants at the Heinz Family Philanthropies asked the Celluci administration, and now that of interim Gov. Jane Swift (R), to hold off implementing the bulk plan for fear of confusing seniors. Prescription Advantage is now "in place," and Swift administration officials "signaled" last week that they are "ready" to consider bulk purchasing. Noting that current high drug prices could "bankrupt" Prescription Advantage, Montigny said that the bulk purchasing plan, which could lead to savings of around 50% per drug, is a "year-and-a-half late and who knows how many millions short."

An 'Embarrassment'
Vermont and Maine have both received Medicaid waivers from HHS to buy drugs for some residents ineligible for Medicaid at the same discounted rate that Medicaid receives from drugmakers under federal mandate, thereby enabling "thousands more [seniors] to buy drugs at low" prices. The pharmaceutical industry, however, has challenged both plans, and a federal court overturned Vermont's waiver, finding that HHS had improperly approved the program. Even so, Vermont is determined to go forward with bulk purchasing, according to Gov. Howard Dean (D), who added, "The prices could be roughly 6% to 8% higher than they would have been without the waiver. But it's still a savings of 15% to 20%." According to Montigny, the pharmaceutical industry has played a role in slowing the implementation of Massachusetts' bulk purchasing plan. But, as the senator hosts a meeting of the Northeast Legislators Association on Prescription Drug Pricing this week -- the same meeting at which he unveiled Massachusetts' bulk plan in 1999 -- Montigny notes the relative failure of his state compared to its neighbors. "For Vermont and Maine to come to Boston to tell us to do something we proposed to do before they did is an embarrassment. It's been a long, sleepy, unfortunate circumstance" (Lauerman, Springfield Union-News, 7/24).

Leading the Way
Stating that the "ever-escalating costs of prescription medications are unconscionable," an accompanying Union-News editorial expresses "hope that Massachusetts will move even more aggressively that it has in the battle to temper the greed of the nation's drug manufacturers." It concludes: "In the absence of a federally sponsored prescription drug benefit, which is still under debate on Capitol Hill, states like Vermont, Maine, New Hampshire -- and yes -- Massachusetts must lead the way" (Springfield Union-News, 7/24). For further information on state health policy in Massachusetts, visit State Health Facts Online.